After Ratzinger became Pope Benedict XVI, a few magazine articles mentioned the reasoning that his strict theology would be a benefit to Catholicism, since it's the more strict religions that are increasing memberships and the looser ones that are not. The general reasoning was that people wanted their religion to stand for something, not for everything.
However, in two separate articles on back-to-back days in my local paper, I saw that the Southern Baptists - a fundamentalist, strict church - have had five straight years of declining baptisms, which is a requirement of church membership. This seems to say that a fairly large, strict church is in fact losing memberships, the opposite of the general theories being bounced around. I think we'll have to wait and see for a few years what happens to the Catholics, but I am not hopeful. I think it'll just take one more implosion in the sex scandals for people to be reminded that Cardinal Ratzinger soft-pedaled the abuse and felt it was being blown out of proportion. When you add this to his moves to shut down opposition voices, well... I don't think you can be too happy.